Mazagon Dock Shares Fall Over 5% After Weak Q4 Results

Stocks in Mazagon Dock Shipbuilders, a major public-sector defense shipyard working under the Ministry of Defence of India, took a steep fall in early trading . The share price cracked 8%, ending a recent string of winning.

The fall comes after the shipyard announced its March quarter financial results. Investors seem to have taken the performance numbers adversely.

Q4 Financials Influence Investor Sentiment

Post-market Thursday, the defence giant reported a sharp 51% drop in Q4 FY25 net profit to ₹325 crore, down from ₹663 crore a year earlier. However, revenue saw a slight uptick of 2.3%, rising to ₹3,174 crore from ₹3,103.7 crore in the same period last year.

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) plummeted by 83% to ₹90 crore during Q4 FY25 from ₹524 crore in the corresponding quarter last year. This caused operating margins to plunge by a substantial 1,500 basis points to a mere 3%, compared to 17% earlier.

The company added that high employee benefit expenses and subcontracting expenditures were among the factors that put pressure on its operating performance in the March quarter. Nevertheless, sources report that the firm was able to beat both revenue and margin full-year estimates.

Momentum Slows in Broader Market

The steep decline on Friday concluded what was otherwise a strong phase for shares of Mazagon Dock. The stock had been on a 6-day winning streak . This recent run helped the share price increase by a whopping 17% this month.

The rally in Mazagon Dock's share, along with other defence sector stocks, was attributed to a robust upsurge in demand at Dalal Street. This heightened investor interest came after the initiation of 'Operation Sindoor', an event touted as demonstrating India's domestically manufactured defence capabilities.

Before today's fall, the stock had gone past the ₹3,700 level for the first time yesterday in the last trading session, hitting an all-time high of ₹3,778 per share. Barring today's fall, the stock seems poised to end the month in the green, its third straight monthly rise.

The stock reached a day's low of ₹3,450 in initial trade after the announcement of results.

As of 11:52 AM, shares of Mazagon Dock Shipbuilders were trading at ₹3,557.30, down 5.17% from the previous close.

Dividend Declaration Announced

The board of Mazagon Dock Shipbuilders has proposed a final dividend of ₹2.71 per equity share for the Financial Year 2024-25. The said dividend, in case it is formally approved in the ensuing Annual General Meeting (AGM), will be payable within 30 days from the date of such declaration. The date of the AGM will be intimated later.

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